SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): December 8, 1997
GIANT CEMENT HOLDING, INC.
(Exact name or registrant as specified in its charter)
Delaware 0-29485 57-0997411
(State or other jurisdiction of (Commission (IRS Employer
incorporated or organization) File Number) Identification No.)
320-D Midland Parkway, Summerville, South Carolina 29485
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (803) 851-9898
N/A
(Former name or former address, if changed since last report.)
Page 1 of 3 Pages
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Item 5. Other Events
On December 8, 1997, the resource recovery operation at Keystone Cement Company,
a wholly-owned subsidiary of Giant Cement Holding, Inc., experienced an
elevation of temperature and gaseous expansion in a waste fuel storage tank
which resulted in a vapor release that was instantaneously ignited and
extinguished. There were no injuries and no known environmental damage. Only
very minimal damage to equipment at the plant occurred.
Immediately after the incident, Keystone ceased utilization of waste fuels and
later entered into a negotiated consent agreement with the Department of
Environmental Protection (DEP) of the State of Pennsylvania to halt the use of
waste fuels at its plant pending an investigation of the cause and determination
of the appropriate corrective actions to ensure that a similar incident does not
occur in the future. A report on the findings and recommended corrective actions
was submitted to the DEP on December 31, 1997.
The Company has met with the DEP and is in the process of submitting additional
information for their review. Pending their review and acceptance of the
submittals, the Company believes that this review process will be complete by
mid-February.
The burning of waste fuels significantly reduces Keystone's coal consumption and
production costs. Additionally, Keystone receives revenue from the customers who
supply these waste-derived fuels. The Company estimates that on short-term
basis, the inability to utilize waste fuel at Keystone reduces its net income
approximately $80,000 per week.
In general, violations of the permit conditions or of the environmental
regulations, even if immaterial or unintentional, may result in fines,
shutdowns, remedial actions or revocation of the permits, the loss of any one of
which could have a material adverse effect on the Company's results of
operations. While there is no present indication that Keystone's waste fuel
burning permits are at risk, the DEP has indicated that violations of Keystone's
permit conditions may have occurred. Keystone is in the process of negotiating a
further consent agreement with the DEP to allow it to resume waste fuel burning
and resolve all outstanding alleged violations of environmental statutes.
Management believes that Keystone should be allowed to resume waste fuel burning
during the first quarter of 1998 and possibly within the next three weeks. In
view of the early stage of the negotiations and the inherent difficulty in
predicting the outcome of these matters, management cannot estimate what the
eventual outcome will be. While the final resolution of these matters may have
an adverse impact on the Company's consolidated financial results for a
particular reporting period, management of the Company believes, based upon the
information developed to date, that any alleged violations can be resolved with
the regulatory agencies involved or through the appeals processes, without
having a material adverse effect on the consolidated financial condition of the
Company.
This release contains forward-looking statements based upon current expectations
that involve a number of business risks and uncertainties. The factors that
could cause results to differ materially include the following: national and
regional economic conditions, changes in the levels of construciton spending,
changes in supply or pricing of waste fuels and other risks as further described
in the Company's Annual Report on Form 10-K filed with the SEC.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GIANT CEMENT HOLDING, INC.
Dated: January 21, 1998 By: /s/Gary L. Pechota
Gary L. Pechota
President and Chief Executive Officer
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